From the Perspective of Ownership Risk, the Best Form of Business

question 54

Multiple Choice

From the perspective of ownership risk, the best form of business organization is the

• A) sole proprietorship.
• B) corporation.
• C) partnership.
• D) S corporation.

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Definitions:

Fixed Costs

Expenses that do not change with the level of production or sales over a certain period, such as rent, salaries, and insurance.

Variable Costs

Costs that vary in direct proportion to changes in levels of production or sales.

Fixed Costs

Expenses that do not change in proportion to the level of production or sales activities, such as rent, salaries, and insurance premiums.

Net Income

The total profit of a company after all revenues, costs, and expenses have been deducted, often referred to as the bottom line.